IN DEEP FREEZE

Amidst the diplomatic row between India and Canada, trade talks between the two countries have been put on hold, but bilateral business and economic relations are expected to continue

- SURABHI

TRADE TALKS BETWEEN India and Canada are expected to remain stuck for the foreseeable future amidst rising diplomatic tensions between the two countries over the Khalistan issue. But, ongoing investments and trade between the two countries may remain unaffected. “It seems unlikely that the trade talks will resume anytime soon. It will be taken up only when both sides are more at ease,” says a source.

Tensions between the two countries escalated after Canadian Prime Minister Justin Trudeau announced that there were “credible allegations” of the Indian government being behind the killing of Canadian citizen Hardeep Singh Nijjar, who was the Khalistan Tiger Force (KTF) chief and a designated terrorist in India. While India has strongly denied the allegation, a full-blown diplomatic war has flared up between the two nations.

The chill in relations was evident even before the G20 Leaders’ Summit in New Delhi on September 9 and 10 that was also attended by Trudeau. Prior to his visit, Canadian government officials had said trade negotiations between the two countries had been paused. This was later confirmed by a top Indian commerce ministry official, who had said that talks for an early harvest scheme (under the trade agreement) have been paused due to “certain political developments”.

The India-Canada Comprehensive Economic Partnership Agreement (CEPA) negotiations were formally re-launched in March 2022 and the two countries had been keen on completing the negotiations by 2023-end. In fact, nine rounds of talks had already taken place till July 2023, and negotiations on topics like goods, trade remedies and rules of origin were underway.